Tuition tax credit, STO scandal story updates

by David Safier
The twin stories of tuition tax credits paying private school tuition for wealthy families and School Tuition Organizations (STOs) keeping too much of the money they're required to disburse are still very much in the news. Both the AZ Republic and the East Valley Trib are keeping the story alive. Our own Star? Not so much. If the Tucson paper has run a follow-up story on the topic since it first broke, I can't remember it. The irony is, the papers got their original tips from Tucson people, but the Star doesn't appear to be interested.

Here are some of the latest stories.

• From the Republic: Some charter schools are figuring out a way to tap into the tax credit dollars earmarked for private school scholarships. The charters have discovered they can keep their morning kindergarten as part of their state funded charter school, then spin off afternoon kindergarten as a private nonprofit and have parents get tuition tax credit scholarships to pay for it. Other charters are doing the same thing with after school and summer programs.
• From the Republic: STOs are required to use at least 90% of the money they collect on scholarships. They can use the other 10% for expenses, though some of them, like Rep. Yarbrough's STO, have interpreted the term "expenses" loosely enough to allow him to profit handsomely. But some STOs aren't fulfilling their legal obligation to give out 90% of the money. Some of them say they're holding money back to make sure they have enough to meet the next year's scholarship obligations. But the fact is, the legislation doesn't specify when they have to spend the money, and they aren't required to account to the state for the money they spend each year, so the state has little idea what's going on.
• From the Trib: Some school Choice proponents are hoping to do damage control by crafting legislation to change the tax credit/STO laws so people who feel less kindly toward tuition tax credits don't take the first steps toward legislative reform. The Goldwater Institute is part of the effort. Meanwhile, the legislative committee looking into the situation will be holding a meeting Sept. 21 (it should be streamed on the web). Rep. Schapira, who is heading the committee, "has started contacting tax credit experts and STOs to see if they will attend."

Dems have something to win politically in this dust up, since the back door voucher legislation was the Rs' brain child. Rs obviously have something to lose for the same reason. On top of that, the story makes good copy for the newspapers, because it's got three hot button elements: scandal, tax dollars and education (are you listening, Star editors?). And you best believe I'm going to write about it whenever the mood strikes or new information crops up. So we haven't heard the last of the story, not by a long shot.